United States (US) and South African government officials met in Paris, France from June 4-5, 2015 to address outstanding agricultural trade issues related to South Africa’s African Growth Opportunities (AGOA) eligibility. On June 5, 2015 the U.S. and South Africa released a joint statement on agricultural trade. The US and South Africa announced the poultry industries for the respective countries had agreed on a framework to provide renewed market access for U.S. bone-in chicken into the South African market. The framework will provide for the return of US bone-in chicken exports to South Africa after the 2 governments complete the necessary implementation steps. The South African government will implement the framework following a public consultation process.

South Africa first imposed anti-dumping duties (ADDs) on frozen bone-in chicken imports from the US in 2000 and in 2012 both extended the ADDs for another 5 years. When negotiations began on June 4, 2015 a wide gap existed between the US and South Africa. The US was proposing 110,000 metric tons (MT) while South Africa was proposing 50,000 MT. A compromise was reached at 65,000 MT. Another element to the offer will include a growth factor which will allow for a percentage increase or decrease of any growth in production or consumption that takes place on annual basis. South Africa also agreed to manage any volatility in the market by spreading the imports over the course of the year.

Another outstanding matter being negotiated is animal health which the South Africa’s Department of Agriculture, Forestry and Fisheries (DAFF) is managing. The issue has to deal with the existing ban on poultry from the US to South Africa due to the existence of avian flu. Fresh/frozen poultry meat derived from birds slaughtered on or after November 25, 2014 is currently ineligible for export to South Africa. Also, fresh/frozen poultry meat shipped on or after December 25, 2014 is currently not allowed entry into South Africa. However, with the current deal in place it is thought the chickens will be sourced from states that are not affected by bird flu. It is anticipated these negotiations will be finalized by the end of June.

Some estimate US chicken growers could benefit by up to $65 million annually with new agreement with South Africa. Meanwhile, South Africa’s poultry industry is concerned they could eventually lose close to $72 million and up to 6,500 jobs in response to the agreement. Both the US and South African governments have committed to further engagements on development issues that will enhance production in South Africa as well as participation of Historically Disadvantaged Individuals into the poultry industry.

The governments also agreed to a firm set of actions in this month to resolve the remaining sanitary issues related to poultry, pork and beef. South Africa has agreed to recommend to the Cabinet to remove the existing ban of beef products from the US because of disease. Similarly pork has also been banned.

In 2011 60% of South Africa’s chicken meat imports came from Brazil while product from the US did not rank even in the top 5. Meanwhile, South Africa’s chicken meat exports in 2011 stayed mostly within the African continent going primarily to Zimbabwe and Mozambique. Brazil dominated South Africa’s turkey meat imports in 2011 followed by Canada, US, UK, and Australia as major sources of product. When South Africa exported product in 2011 it stayed mostly within the African continent.

In response to South Africa’s poultry import bans on the US, US January-April 2015 poultry exports to South Africa have declined 99% from the same time frame in 2014.

On June 10, the USDA World Agriculture Outlook Board (WAOB) released its monthly World Agriculture Supply and Demand Estimates report. According to the report, total world meat production for 2015 is forecast to be lower than last month, but higher for 2016. Beef production during 2015 is predicted to total 24.1 million pounds, which is 1.1 percent lower than the May estimate and 1.0 percent lower than 2014, due to reduced slaughter for fed cattle, cow and bulls. Conversely, beef production in 2016 is expected to increase to 27.8 million pounds, as placements of cattle in late 2015 are predicted to be higher as forage supplies in much of the country have improved, resulting in higher slaughter for 2016. Beef imports during 2015 are forecast to increase 6.4 percent over the previous month and increase 12.5 percent over last year, amounting to 3.3 million pounds as demand for processing grade beef remains strong. Projections for beef imports during 2016 are also expected to rise. Beef exports for 2015 are expected to reach 2.5 million pounds, unchanged from May but 4.4 percent lower than last year. During 2016, beef exports are forecast to be higher equaling 2.5 million pounds. Meanwhile, WAOB predicts pork production to total 24.5 million pounds in 2015, which is slightly higher than May and 7.1 percent higher than the same period a year ago. This estimate has risen due to higher than expected second quarter slaughter. During 2016, pork production is projected to increase 1.0 percent over 2015, totaling 24.7 million pounds. Pork imports for 2015 are expected to equal 1.2 million pounds, 1.7 percent less than the May estimate but 15.0 percent more than last year. Pork imports during 2016 are predicted to fall 13.5 percent from 2015 to 1.0 million pounds. During 2015, pork exports are forecast to rise 1.0 percent over last month and rise 1.2 percent over last year to 4.9 million pounds based on the pace of trade to date. Projections for 2016 pork exports are expected to total 5.1 million pounds, 4.1 percent higher than 2015. To obtain the entire report, go to the WOAB website at http://www.usda.gov/oce/commodity/wasde/.

According to data from the USDA Livestock, Poultry and Grain Market News (LPGMN), through May 31, 2015, the U.S. imported 508,654 head of feeder cattle from Mexico. This was 11.5 percent more than one year ago and was 15.4 percent more than two years ago. During this time, Mexico imported 212,698 head of feeder cattle to New Mexico, which comprised 41.8 percent of the total market share. During the same time frame, feeder cattle imports from Canada totaled 209,784 head, which was 1.9 percent lower than a year ago. Imports of slaughter steers and heifers from Canada were down 49.1 percent from last year, amounting to 94,887 head. Imports of slaughter cows and bulls totaled 111,372 head, 25.7 percent less than a year ago. U.S. feeder pig imports from Canada through May 31 were up 6.3 percent from one year ago, totaling 1,713,039 head. Total slaughter hog imports from Canada equaled 464,284 head, which was 43.8 percent higher than a year ago. To obtain the weekly reports, visit the LPGMN website at http://www.ams.usda.gov/lpsmarketnewspage.

Pacific Rim: Recently, the Korea International Trade Association (KITA) published South Korea’s beef and pork import numbers for May 2015. According to the data, during May, South Korea’s beef imports rose 9.6 percent over April to 23,612 MT. Also, this was a 16.7 percent higher than May 2014. Specifically, imports of frozen product equaled 19,788 MT, which comprised 83.8 percent of the total. Fresh, chilled product equaled 3,824 MT. South Korea’s beef imports from Australia during May totaled 13,509 MT. This was up 9.3 percent over the previous month and was up 19.8 percent over May 2014. Year-to-date beef imports from Australia totaled 65,720 MT, 5.8 percent more than last year. Australia was the leading beef import market for South Korea with 57.0 percent of the total. During May, South Korea imported 8,260 MT of beef from the U.S., which was 16.1 percent higher than the previous month and was 19.6 percent higher than May 2014. Total year-to-date beef imports from the U.S. were down 8.3 percent from a year ago, amounting to 39,141 MT. During May, beef imports from New Zealand fell 6.8 percent from the previous month and fell 11.1 percent from May 2014 to 1,641 MT. Year-to-date beef imports from New Zealand were 11.4 percent less than last year, totaling 8,775 MT. Overall, South Korea’s total year-to-date beef imports equaled 115,362 MT, which was slightly lower than the same period a year ago. In the meantime, during May, South Korea imported 40,583 MT of pork. This was up 3.2 percent over the previous month and was up 42.7 percent over May 2014. During May, pork imports from the U.S. rose 24.3 percent over the previous month to 15,214 MT. Also, this was 51.3 percent higher than May 2014. Total year-to-date pork imports from the U.S. equaled 60,196 MT, 12.7 percent more than a year ago. The U.S. was the primary supplier of pork to South Korea with 31.1 percent of the total imports. South Korea’s pork imports from Germany during May totaled 7,054 MT. This was 1.2 percent more than the previous month and was 60.6 percent more than May 2014. Year-to-date pork imports from Germany were 59.9 percent greater than last year, amounting to 34,387 MT. During May, South Korea imported 4,198 MT of pork from Spain, which was 17.2 percent less than April but was 75.2 percent more than May 2014. Year-to-date pork imports from Spain totaled 26,967 MT, 152.1 percent more than a year ago. Overall, South Korea’s total yearto-date pork imports equaled 193,306 MT, which was 32.7 percent above the corresponding period a year ago. To obtain further data on South Korea’s trade, go to the KITA website at http://www.kita.org/.

North America: On June 22, the USDA NASS released its monthly Cold Storage report. According to the report, as of May 31, 2015, beef in U.S. cold storage facilities equaled 468.6 million pounds, which was 6.1 percent higher than a year ago and was 24.1 percent higher than the five year average. More specifically, boneless beef in cold storage totaled 429.4 million pounds, 27.8 percent more than a year ago. Beef cuts in cold storage totaled 39.2 million pounds, which was down 5.7 percent from last year. In the meantime, as of May 31, 2015, the volume of pork in cold storage totaled 653.6 million pounds. This was 13.7 percent more than a year ago and was 13.5 percent more than the five year average. More specifically, hams in storage were up 43.8 percent over last year, totaling 158.1 million pounds. The volume of pork bellies in cold storage fell 24.5 percent from a year ago to 64.8 million pounds. Loins in storage totaled 39.4 million pounds, nearly unchanged from a year ago. Pork ribs in storage equaled 89.9 million pounds, slightly higher than last year. The volume of pork butts in cold storage was 7.1 percent less than a year ago with 20.2 million pounds. Pork trimmings in storage totaled 50.6 million pounds, 5.7 percent more than a year ago. The volume of veal in U.S. cold storage was up 58.1 percent over a year ago, totaling 4.4 million pounds. Lamb and mutton in cold storage equaled 39.2 million pounds, which was 55.6 percent higher than last year. To obtain the entire report, go to the NASS website at http://www.nass.usda.gov/.

On June 19, the USDA National Agricultural Statistics Service (NASS) published its monthly Cattle on Feed report. According to the numbers, cattle and calves on feed for the U.S. slaughter market for feedlots with a capacity of 1,000 or more head equaled 10.56 million head on June 1, 2015. This was slightly higher than one year ago but was 1.9 percent lower than two years ago. The number of cattle placed on feed during May fell 10.2 percent from one year ago to 1.71 million head. Also, this was down 16.6 percent from two years ago. More specifically, feeder cattle placements weighing less than 600 pounds totaled 355,000 head, which was 18.4 percent less than last year. Placements weighing 600 to 699 pounds were down 10.3 percent from a year ago, totaling 206,000 head. Placements weighing 700 to 799 pounds decreased 17.9 percent from last year to 389,000 head. Finally, placements of feeder cattle weighing more than 800 pounds totaled 710,000 head, unchanged from a year ago. In the meantime, U.S. fed cattle marketings during May equaled 1.71 million head, which was 8.3 percent lower than one year ago and was 12.2 percent lower than two years ago. The entire report can be found on the NASS website at http://www.nass.usda.gov/.

CanFax recently published Canada’s current cattle on feed numbers for terminal feedlots with 1,000 head or more in the provinces of Alberta and Saskatchewan. According to the statistics, Canada’s total cattle on feed on June 1, 2015 equaled 808,267 head. This was 9.0 percent less than one year ago and was 8.4 percent less than the five year average. Cattle placed on feed during May totaled 92,531 head. This was 4.1 percent less than one year ago and was 13.3 percent less than the five year average. The number of steers placed on feed totaled 58,656 head, which accounted for 63.4 percent of the total. Heifers placed on feed totaled 33,875 head. Specifically, placements of feeder cattle weighing less than 600 pounds totaled 2,903 head, which was 29.1 percent less than a year ago. Placements of feeder cattle weighing 600 to 699 pounds were down 46.1 percent from a year ago, amounting to 6,881 head. Placements weighing 700 to 799 pounds equaled 17,030 head, 12.7 percent below a year ago. Finally, placements weighing more than 800 pounds totaled 65,717 head, 9.4 percent more than last year. Meanwhile, during May, Canada’s fed cattle marketings fell 22.4 percent from a year ago to 103,152 head. Also, this was 30.7 percent less than the five year average. To view the complete report, go to the CanFax website at http://www.canfax.ca/.